711.9327/3–1948: Telegram

The Ambassador in China ( Stuart ) to the Secretary of State

505. ReEmbtel 494, March 19. During course discussion re bilateral air agreement March 18, Lin handed Merchant copy of draft note which Chinese desired United States regard as statement of issues which they wished to discuss. First paragraph contained revised language paragraph (b) of note exchanged when Agreement signed in 1946. Following section paragraph (b) “—no shuttle service will be operated by designated United States carriers between Hong Kong—” revised to read “—the designated United States carriers shall not carry any regional traffic in passengers, cargo or mail between Hong Kong—”. Words “and New York” inserted after “at San Francisco”.

In other paragraphs this draft Chinese requested:

1.
Paragraphs (b) 1 and (b) 2 of the annex be changed to read as follows: Subparagraph (1) China over-Pacific route to Seattle, San Francisco and New York and beyond; subparagraph (2) China over-Pacific route to Honolulu, Los Aiigeles, San Francisco and New York and beyond.
2.
Insertion in annex of paragraph to be numbered b3 which would read: “Suitable technical landing points in the US territory for the operation by Chinese carriers on each of the above routes, shall be provided by the US Government”.
3.
“(c): In addition to the foregoing modifications both Governments further agree that they will permit the designated carriers of the other party to send officers and/or employees into their territory [Page 793] for the purpose running of their business; and that they will allocate to the designated carriers of the other party a fair share of the international mail to be brought out of their respective territory.”

Jarvis discussed draft note with Lin on March 19, and informed him that Chinese requested revision of routes substantive and in effect request for renegotiation of agreement. Lin mentioned that China was prepared accord to US rights operate to Kunming. Jarvis said as Lin would recall US had stated at time negotiation agreement it desired obtain rights at Mukden. Lin replied only point Chinese could now offer would be Kunming as this only other point which had been designated by China as an international airport and which US did not now touch. Lin was then informed that, notwithstanding such designation, US could request rights to land at other points. Following mention of Mukden, Lin visibly cooled on pressing for route revisions outlined and said that to China this was minor matter; that Shanghai-Hong Kong question was important subject. He did, however, wish United States to entertain the request and at same time stated that US, greatest advocate of Fifth Freedom principle, should certainly be willing to permit China fly across US in order facilitate China’s operations on to Europe. China did not, of course, in making this proposal have in mind movement of cabotage traffic.

When queried concerning paragraph b 3, Lin frankly said he did not know why it had been inserted and could not contact officer of CCAA who drafted it. He was informed that US could not understand why such a paragraph had been inserted as US had excellent airports and facilities and had made these facilities available for technical landings.

Concerning matter of visas, Lin agreed this subject could be handled in accordance with US suggestion that Embassy dispatch note to Minister Foreign Affairs confirming that US in accordance with usual procedures will grant visas to Chinese nationals going to US to work for hire for airlines designated by China operate to US.

Lin was informed that question of movement by Chinese carriers of international mail originating in US was not relevant and should be removed from these discussions. It was suggested to him that this should be handled between Embassy and Foreign Office as an independent matter. Lin said he would further consult Foreign Office this connection.

According to PanAm, Chinese levy tax of US 17 cents per gallon on gasoline loaded on US planes here. Embassy now investigating facts this situation and if Department perceives no objection will raise this question with Chinese during course consultation.

Embassy would welcome instruction from Department inform Chinese US will not agree to any changes in route pattern. Foregoing [Page 794] on assumption US not interested at this time obtaining rights land other points here such as Mukden.

Sent Department 505, repeated Shanghai 203.

Stuart